A map showing tracts available as part of an upcoming state oil and gas lease sale in Cook Inlet. (Map via Alaska Department of Natural Resources’ Division of Oil and Gas)

A map showing tracts available as part of an upcoming state oil and gas lease sale in Cook Inlet. (Map via Alaska Department of Natural Resources’ Division of Oil and Gas)

State to begin accepting Cook Inlet oil and gas lease bids next month

Bidding will open Dec. 12 and close on Dec. 28 at 4 p.m.

The State of Alaska will begin accepting bids next month on roughly 2.8 million acres of land in Cook Inlet as part of a winter oil and gas lease sale.

The Winter 2022 Competitive Oil and Gas Lease Sale will include 721 state-owned tracts, ranging in size from 640 to 5,760 acres, as part of the Cook Inlet Areawide sale — the area’s 25th such sale. The state has a total of 833 tracts covering 3.3 million acres in the area.

Bidding on tracts as part of the sale, offered by the Alaska Department of Natural Resources’ Division of Oil and Gas, will open Dec. 12 and will close on Dec. 28 at 4 p.m. Bids are submitted through EnergyNet.

Among the state’s successful bidders as part of last year’s sale were HEX, LLC, Furie Operating Alaska, LLC and Strong Energy Resources, LLC. The three companies, all considered competitors of Hilcorp, acquired a combined 21,200 acres throughout Cook Inlet.

The sale will come as the federal government advances its own plans for an oil and gas lease sale in Cook Inlet’s federal waters. The Inflation Reduction Act of 2022, which President Joe Biden signed in August, directs the Bureau of Ocean Energy Management to hold Lease Sale 258 before the end of the year.

Lease Sale 258, as proposed in 2020, would open just over 1 million acres of seafloor between Kalgin and Augustine islands in Cook Inlet to oil and gas development. Supportive of the sale have been resource development groups like the Alaska Oil & Gas Association, while those opposed include environmental groups like Cook Inletkeeper, which last year organized an art sale to raise awareness about the sale.

Alaska Department of Natural Resources Deputy Commissioner John Crowther is quoted in a press release as saying that the state’s lease sale is being held to coincide with the federal government’s sale in Cook Inlet’s federal waters.

“The basin still holds significant potential and an important step to unlocking it is to consistently offer open acreage to explorers,” Crowther is quoted as saying in the release.

The same release says that 424,000 acres of land on 207 leases within Cook Inlet are currently held by industry lessees. Of those, 106 leases covering more than 65,500 acres are in production and paying royalties to the State of Alaska, according to the department release.

Bidding results from the state’s sale will be publicly available on Dec. 30. More information on the sale can be found at dog.dnr.alaska.gov.

Reach reporter Ashlyn O’Hara at ashlyn.ohara@peninsulaclarion.com.

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